Fourth in a five-part series

Welfare has emerged as a high-profile issue in the 2014 gubernatorial race, with ads about illegal immigrants receiving tax dollars filling the airwaves and mailboxes.

The University of New Hampshire Survey Center has conducted two polls for the Portland Press Herald/Maine Sunday Telegram. In June, 46 percent of poll respondents believed that welfare did more harm than good. By September, that sentiment was 50 percent.

Maine’s welfare system is a complex web of programs, including MaineCare – the state’s Medicaid program – Temporary Assistance to Needy Families and Supplemental Nutrition Assistance Program (food stamps). The programs are mostly funded by federal money.

So far in 2014, the state has spent $1.5 million on nutrition assistance and disbursed an additional $336 million in federal food stamp funds, said John Martins, spokesman for the Department of Health and Human Services. The state paid $33.1 million in assistance to needy families and disbursed $49 million in federal temporary assistance. The state also paid nearly $13 million in general assistance to municipalities, he said.

During the first eight months of 2014, an average of 7,180 families a month, including 11,711 children, received temporary assistance benefits, according to publicly available state reports. Over that same period, food stamp benefits went to a monthly average of 233,350 people.

With the issue of welfare reform resonating with voters, Maine’s next governor will need to make critical decisions about welfare policy.

Republican Gov. Paul LePage has made welfare reform a central issue of his first term in office and his re-election campaign. He, Democratic U.S. Rep Mike Michaud and independent Eliot Cutler have diverse opinions on ways to change Maine’s welfare system.

Here’s a look at where the three candidates stand on key welfare issues:

IMMIGRATION

A battle over General Assistance

Republican television ads and mailers have been making a big deal out of welfare being provided to illegal immigrants. But what’s it all about? The issue arose in the past year, when LePage sought to bring Maine into compliance with the “Personal Responsibility and Work Opportunity Reconciliation Act” enacted in 1996 by the Republican-controlled Congress and Democratic President Bill Clinton, who has campaigned for Michaud. The reform act prohibits most immigrants – including undocumented immigrants and others who may be lawfully present in the United States, and also including people seeking asylum to escape political or religious persecution – from receiving federal welfare.

The act allows states to enact their own laws allowing these people to receive state and local benefits. LePage says the state hasn’t done this. The state’s attorney general has called LePage’s plan to deny General Assistance to immigrants unconstitutional, and Michaud says a state law is not necessary. A resolution to LePage’s plan is still pending in the court system.

LEPAGE sees the potential in immigrants starting a new life in Maine, but he doesn’t support allowing them to receive General Assistance. Resources are limited and there is no clawback provision to reclaim assistance from asylum seekers whose applications have been denied, he said. Denying General Assistance to what federal law calls “non-qualified immigrants” is intended to bring Maine into compliance with federal law, while protecting benefits for the disabled and elderly. “General Assistance should be a last-resort, emergency benefit for needy Mainers, not a resettlement benefit for non-qualified immigrants,” he said.

MICHAUD does not support giving welfare benefits to illegal immigrants, but he opposes LePage’s efforts to prohibit asylum seekers from receiving general assistance. He believes LePage only wants to score political points, and to “distract from his dismal economic record, divisive style and embarrassing outbursts.” He said the governor’s proposal would turn municipal officials into de facto immigration officials. He doesn’t think Maine needs to pass a new law to continue providing general assistance to asylum seekers. “We can’t turn our backs on people who are fleeing violence, sex trafficking and persecution,” he said. “It’s wrong. It hurts our cities and towns. And it denies our obligation to take care of one another.”

CUTLER also disagrees with the governor’s General Assistance reform. He noted that asylum seekers are legally in the U.S. to escape political or religious persecution. He said his grandfather received asylum when he came to the U.S. at the age of 12 from Russia to escape conscription into the czar’s army. He’d ask the attorney general to meet with the federal government about how to ensure that asylum seekers can continue to receive General Assistance, without burdening municipal officials. “They are not illegal immigrants, and I believe that we should welcome them and help them create a new life,” Cutler said. “Most of them will soon become contributors to a growing economy.”

WASTE, FRAUD AND ABUSE

Agreement on goal, not methods

Ending waste, fraud and abuse within the state’s welfare system is a rare point of agreement among all three candidates. They differ, however, on how and where they’d look.

LePage has focused most of his policies on reducing fraud among recipients. He has put a 60-month cap on the amount of time that recipients can collect temporary assistance benefits. He has also required that photos be included on electronic benefit transfer – EBT – cards to prevent their misuse. The governor also has mandated drug testing of felons, and has added funding and staffing to increase state investigations of suspected welfare cheats.

CUTLER supports making it illegal to use EBT cards at places like liquor stores and gambling facilities, but he also has proposed embedding microchips in the cards to combat waste, fraud and abuse at the recipient and provider levels. So-called smart cards also are less costly, and more effective, than putting photos on the benefit cards, as LePage has done, he said. Smart cards are harder to counterfeit; can manage several programs on one card; block use at prohibited locations; and can store life-saving information such as blood type and allergies, he said. They would reduce fraud by requiring a two-way verification between the MaineCare provider and the recipient, which would prevent phantom billing by providers, he said.

MICHAUD has proposed creating an independent office of inspector general, costing about $578,000 a year, to root out waste, fraud and abuse among recipients, providers and within the DHHS. He said LePage’s focus on welfare recipients is more about politics than fixing the system. He would end LePage’s initiative of putting photos on the benefit cards, saying it puts federal food stamp funding at risk and causes confusion among store owners and recipients. He supports a five-year limit on temporary assistance benefits as long as DHHS is properly enforcing that cap.

LEPAGE says he has focused on recipient fraud because it has been neglected by previous administrations. In 2013, he spent $700,000 to hire additional investigators, resulting in $209,000 in court-ordered restitution that year. In 2014, the ordered restitution to date is $137,500. In a second term, he would continue the crackdown on recipients by trying to limit out-of-state use of the benefit cards, making it illegal to use them at smoke shops and tattoo parlors and prohibit using food stamps to purchase junk food. “It’s unacceptable for welfare dollars to be used at Disneyland or for tattoos and Red Bull,” LePage said.

WELFARE-TO-WORK

Differences on ending dependence

There is a lot of talk about a so-called cliff effect, where recipients immediately lose their benefits as soon as they become employed. DHHS spokesman Martins said the loss of benefits is the result of many factors, including family size and income, and differs with each program. The current system has been criticized for providing disincentives for recipients to work, often contributing to welfare dependence, especially if the recipient gets a minimum-wage job at $7.50 an hour.

CUTLER described Maine’s welfare system as “patchwork, uncoordinated” and lacking any incentive for low-income families to improve their position. High marginal tax rates result in 80 cents of each additional dollar earned being “clawed back” by the government, he said. He thinks the state needs a tiered reduction in benefits. The earned-income tax credit ought to be enhanced and made refundable for food stamp and temporary assistance recipients who have completed Maine’s high school equivalency test. He said the changes can be made without additional funding.

MICHAUD wants to raise the minimum wage to $9 an hour over a three-year period, so low-wage workers, the majority of whom are women, have a better chance of paying their bills without assistance. He also supports an enhanced and refundable earned-income tax credit. In addition to a tiered reduction in benefits for recipients who get jobs, he supports an apprenticeship program to put recipients on a career path. Both programs could be funded without increasing spending, he said.

LEPAGE said, “The ‘cliff effect’ may be a problem, but the ‘get it forever effect’ is worse.” Having already increased work requirements for recipients, he would continue to demand self-sufficiency by creating “good jobs.” He did not detail his “other ideas” to address the cliff issue.